TSMC, Bosch, Infineon, & NXP Establish Chip Joint Venture to Support Automotive & Industrial Sectors

Robert Bosch GmbH, Infineon Technologies AG and NXP Semiconductors N.V. and TSMC plan to launch a European semiconductor joint venture (JV) plan to to support the future capacity needs of the fast-growing automotive and industrial sectors. They will jointly invest in European Semiconductor Manufacturing Company (ESMC) GmbH, that will be based in Dresden, Germany.

The planned JV will be 70 percent owned by Taiwan-based TSMC, with Bosch, Infineon, and NXP each holding 10 percent equity stake.

Total investments are expected to exceed 10 billion euros consisting of equity injection, debt borrowing, and support from the European Union and German government.

ESMC aims to begin construction of the facility in the second half of 2024, with production targeted to begin by the end of 2027.

It will be operated by TSMC.

Dr. Stefan Hartung, chairman of the Bosch board of management, says: “Semiconductors are not only a crucial success factor for Bosch. Their reliable availability is also of great importance for the success of the global automotive industry. Apart from continuously expanding our own manufacturing facilities, we further secure our supply chains as an automotive supplier through close cooperation with our partners. With TSMC, we are pleased to gain a global innovation leader to strengthen the semiconductor ecosystem in the direct vicinity of our semiconductor plant in Dresden.”

“This investment in Dresden demonstrates TSMC’s commitment to serving our customers’ strategic capacity and technology needs, and we are excited at this opportunity to deepen our long-standing partnership with Bosch, Infineon, and NXP,” adds Dr. CC Wei, Chief Executive Officer of TSMC. “Europe is a highly promising place for semiconductor innovation, particularly in the automotive and industrial fields, and we look forward to bringing those innovations to life on our advanced silicon technology with the talent in Europe.”

“Our joint investment is an important milestone to bolster the European semiconductor ecosystem. With this, Dresden is strengthening its position as one of the world’s most important semiconductor hubs that is already home to Infineon’s largest frontend site,” comments Jochen Hanebeck, CEO of Infineon Technologies. “Infineon will use the new capacity to serve the growing demand particularly of its European customers, especially in automotive and IoT. The advanced capabilities will provide a basis for developing innovative technologies, products and solutions to address the global challenges of decarbonization and digitalisation.”

“NXP is very committed to strengthening innovation and supply chain resilience in Europe,” says Kurt Sievers, President and CEO of NXP Semiconductors. “We thank the European Union, Germany, and the Free State of Saxony for their recognition of the semiconductor industry’s critical role and for their true commitment to boost Europe’s chip ecosystem. The construction of this new and significant semiconductor foundry will add much needed innovation and capacity for the range of silicon required to supply the sharply increasing digitalization and electrification of the automotive and industrial sectors.”

Bosch is pursuing a global growth strategy with its semiconductor business. Over the next three years, it plans to invest some three billion euros in Dresden and Reutlingen.